Remembering John Neff

An article in Barron’s remembers legendary investor and long-time Barron’s Roundtable member John Neff, who died earlier this month at 87.

“Neff favored deeply unloved stocks with hidden potential,” the article says, adding, “And he bought them by the truckload for the Vanguard Windsor Fund, which he managed for 31 years through 1995.” For the same period of time, Neff also served as a member of the Barron’s Roundtable, which the article describes as an annual gathering of prominent investors to which Neff brought his “trademark wit and contrarian wisdom.”

The article recounts an interview with Neff back in 2002, in the wake of the dot-com bust, when he said, “I would guess my kind of fare—honest-to-goodness, decent fare, at a low P/E—will come back decently.” He recalled the strategy used during his days at Windsor of buying companies with solid fundamental at a 40%-50% discount to the market P/E. “Now,” he said during the interview, “you can get them at 50%-60% discounts.”

The article quotes Neff: “It’s not always easy to do what’s not popular, but that’s where you make your money. I look for solid fundamentals, a beat-up chart and a good price…Eventually, if you’re right, these stocks move to stronger hands.”

John Neff, the article says, is an American success story who “owed his good fortune to hard work, smarts, and integrity, and was decent to the core.”